MPs have sounded the alarm over a slump in investment in green technologies.
They said there had been “a dramatic and worrying collapse” in this since 2015, putting clean energy projects at risk.
A report Green finance: mobilising investment in clean energy and sustainable development, from the environmental audit committee, said ministers must publish a plan to secure the investment needed to meet the UK’s carbon reduction commitments.
Investment in clean energy fell by 10% in cash terms 2016 and by 56% in 2017, putting annual investment at its lowest since 2008, the report said.
It also said the ”protracted privatisation process” of the Green Investment Bank - now the Green Investment Group - had played a role in the fall in investment.
Committee chair, Labour MP Mary Creagh (pictured), said: “Billions of pounds of investment is needed in clean energy, transport, heating and industry to meet our carbon targets. But a dramatic fall in investment is threatening the Government’s ability to meet legally binding climate change targets. The Government’s clean growth strategy was long on aspiration, but short on detail.”
“The Government must urgently plug this policy gap and publish its plan to secure the investment required to meet the UK’s climate change targets.”
The report said the clean growth strategy could not deliver legally binding climate change targets, even if all its policies were delivered in full, and it was likely that changes to low-carbon energy policy in 2015 undermined investor confidence and led to a reduction in the number of projects in development.
It said the Government should negotiate to maintain the UK’s relationship post-Brexit with the European Investment Bank, “which would allow riskier early-stage green infrastructure projects in the UK continued access to development bank finance”.
A new ‘sovereign green bond’ could be created to raise the capital necessary to deliver carbon budgets, the committee suggested, while local authorities should be encouraged to mobilise investment in low carbon projects.
The report said though that the UK had made significant progress in redirecting investment towards cleaner sources of power since the Climate Change Act 2008, with the proportion generated from low-carbon sources having doubled between 2009-17 and reached a record 50% last year.
James Court, head of policy at the Renewable Energy Association, said: “This report perfectly chimes with the reality that our members are feeling. There is a real frustration that at a time of renewable costs plummeting and other countries steaming ahead, the UK is going backwards.
”Government must now move forward quickly by implementing the recommendations of the Green Finance Task Force that reported back in March.”
A spokesperson for the Department of Business, Energy and Industrial Strategy said: “The UK is a world-leader in cutting emissions, with 50% of our electricity coming from low-carbon sources and recently going 72 hours without burning coal.
“We’re committed to meeting our climate change targets and will have invested £2.5bn on low carbon innovations by 2021. We will consider this report carefully and respond in full in due course.”